Alert July 27, 2007

Complying with the New EEO-1 Report Due in September 2007

Employers required to file an EEO-1 report must use the newly revised EEO-1 report for the September 30, 2007 filing.

What Is the EEO-1 Report?

The Equal Employment Opportunity Commission (“EEOC”) and the Office of Federal Contract Compliance Programs (“OFCCP”) adopted the EEO-1 report in 1966 to collect annual data from many private employers and federal contractors about their minority and female workforce. Both agencies use the data for enforcement. The OFCCP uses EEO-1 data to determine which employer facilities to select for compliance evaluations. The EEOC uses the EEO-1 data to analyze trends in female and minority employment within companies, industries, regions and sectors of the economy.

The report requires employers to provide a workforce breakdown by job category and by race, ethnicity and gender.

Who Must Complete an EEO-1 Report and When?

With limited exceptions, all private employers with at least 100 employees and all federal contractors with at least 50 employees and contracts of $50,000 or more are required to file the EEO-1 form annually (the EEOC strongly encourages that EEO-1 reports be submitted through the EEO-1 Online Filing System or as an electronically transmitted data file). The next form is due by September 30, 2007. Employers must use employment data from any pay period between July and September 2007 for the 2007 report.

Major Changes to the EEO-1 Report

Changes to race and ethnic categories

  • A new category titled “two or more races” is added. This does not require reporting of the specific races. If an employee specifies several races (for example, employee indicates she is White and African American), the employer should count this employee in the “two or more races” category.
  • The current “Asian or Pacific Islander” category is divided into two separate categories, “Asian” and “Native Hawaiian or other Pacific Islander.” An “Asian” is defined as a person having origins among any of the original peoples of the Far East, Southeast Asia or the Indian subcontinent including, for example, Cambodia, China, India, Japan, Korea, Malaysia, Pakistan, the Philippine Islands, Thailand and Vietnam. A “Native Hawaiian or other Pacific Islander” is defined as a person having ancestors among any of the peoples of Hawaii, Guam, Samoa or other Pacific Islands.
  • “Black” is renamed “Black or African American.”
  • “Hispanic” is renamed “Hispanic or Latino.”
  • The EEOC strongly endorses self-identification of race and ethnic categories, as opposed to visual identification by employers.

Changes to job categories

  • The current category of “Officials and Managers” is divided into two levels based on responsibility and influence within the organization. The EEOC determined that a single category for all officials and managers was not acceptable because it conflates data about jobs of widely discrepant responsibility, compensation and skill, and thereby risks obscuring important trends in the employment of women and minorities.
  • The two levels are:
  • (1) These are employees who plan, direct, formulate policy, set strategy and provide overall direction. In larger organizations (an undefined term), this level is defined as those jobs within two reporting levels of the CEO. Examples of these kinds of managers are: chief executive officers, chief operating officers, chief financial officers, line of business heads, presidents or executive vice presidents of functional areas or operating groups, chief information officers, chief human resources officers, chief marketing officers, chief legal officers, management directors and managing partners. (2)These employees direct implementation or operations within specific parameters set by Executive/Senior Level Officials and Managers and oversee day-to-day operations. Examples of these kind of managers are: vice presidents and directors, group, regional or divisional controllers, treasurers and human resources, information systems, marketing and operational managers. Also included are those employees who report directly to middle managers such as first-line managers, team managers, unit managers, operations and production managers, branch managers, administrative service managers, purchasing and transportation managers, storage and distribution managers, call center or customer service managers, technical support managers and brand or product managers.
  • Business and financial occupations are moved from Officials and Managers category to Professionals category.

Does an Employer Have to Resurvey Its Current Employees?

An employer is not required to resurvey current employees for the September 30, 2007 EEO-1 report. If an employer does not resurvey for the 2007 EEO-1 report it should count employees who previously identified as “Asian or Pacific Islander” as “Asian.”

The EEOC encourages (but does not require) employers to resurvey their employees for the 2007 report. The EEOC suggests, for example, that an employer that periodically asks its employees to update their personal information may use these periodic requests to ask employees to confidentially self-identify using the EEO-1 race and ethnic categories. An employer could also provide a page on its internal website for employees to voluntarily and confidentially self-identify. Significantly, the EEOC suggests that if an employer chooses to resurvey, it should survey the entire workforce – for example, surveying only employees counted as “Asian or Pacific Islander” could create a perception that management is singling out one racial group.

If an employer elects not to resurvey for the 2007 report, the employer should plan to resurvey before the 2008 report.

Self-Identification

Self-identification is a basic principle underlying the changes to the EEO-1 report. If an employer believes that an employee is of a different race or ethnicity than the employee claims to be, the employer must accept the employee’s self-identification by race and by ethnicity. If an employee refuses to self-identify, an employer may obtain the necessary information from existing employment records or visual observation – but only if an employee refuses to self-identify.

The EEOC suggests that employers adopt the following statement for use with its employees:

“The employer is subject to certain governmental record keeping and reporting requirements for the administration of civil rights laws and regulations. In order to comply with these laws, the employer invites employees to voluntarily self-identify their race or ethnicity. Submission of this information is voluntary and refusal to provide it will not subject you to any adverse treatment. The information will be kept confidential and may only be used in accordance with the provisions of applicable laws, executive orders, and regulations, including those that require the information to be summarized and reported to the federal government for civil rights enforcement. When reported, data will not identify any specific individual.”

Two-Question Format

In order to yield more accurate data about Hispanics or Latinos the EEOC has adopted a “two-question format” which requires employees to first report their Hispanic or Latino status and second the race(s) the employee considers him or herself to be. Employees who self-identify as Hispanic or Latino should not be asked to self-identify in any racial category. The revised form provides a category entitled Hispanic or Latino and a category entitled Not-Hispanic or Latino. Under the Not-Hispanic or Latino heading are the racial groups (White, Black or African American, Native Hawaiian or Other Pacific Islander, Asian, American Indian or Alaska Native, or Two or more of the preceding races). If an employee self-identifies as Hispanic or Latino, he or she should be reported as Hispanic or Latino, even though the employee may also claim to be a different race.

Affirmative Action Reporting

At present, federal contractors should continue to use the old classifications for purposes of affirmative action reporting requirements. The OFCCP has not yet indicated when it will change its racial categories to comport with the new EEO-1 categories. Additionally, the Department of Labor/VETS has not stated whether or when it will adopt the EEO-1 categories for the VETS-100 annual report. Therefore, for the time being, federal contractors should collect ethnicity and racial information for both the OFCCP’s categories and the EEOC’s categories.

Action Steps

  • Determine if your organization will resurvey for the 2007 report. If you plan to resurvey, begin the process as soon as possible. If possible, use one of the methods to resurvey described above and the EEOC’s suggested language for requesting employees to self-identify race/ethnicity.
  • Reassign job titles to the new EEO-1 job categories. This may require reviewing position descriptions or requirements of all jobs previously assigned to the former Officials and Managers category.
  • Modify post-hire forms used to collect race/ethnicity information for new employees to comply with the new form.
  • Update any software used to track EEO-1 information.